What are interim dividends?

An interim dividend is a payment made by a company to its shareholders from its distributable profits, typically declared before the end of the financial year. Shareholders can be individuals (natural persons) or corporate entities, such as where a holding company structure is in place. To lawfully pay an interim dividend, a company must have sufficient distributable profits available at the point of payment. For further details on what constitutes distributable profits, see What do I need to consider before taking an interim dividend?